It has been about a month since the last earnings report for Cardiovascular Systems, Inc. CSII. Shares have added about 11.1% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Recent Earnings
Cardiovascular Systems, Inc. reported earnings per share of $0.03 in second-quarter fiscal 2017, reflecting a massive improvement from the year-ago quarter’s loss of $0.47. Also, earnings compared favorably with the Zacks Consensus Estimate of a loss of $0.06.
The year-over-year improvement in earnings was primarily backed by revenue growth, better gross margin and lower operating expenses on account of the company’s cost realignment actions.
Quarter in Details
Cardiovascular Systems posted revenues of $50.0 million in the fiscal second quarter, marking a year-over-year increase of 20.9%. However, revenues were in line with the Zacks Consensus Estimate.
Per management, the strong top-line performance exhibited the company’s efforts to stabilize and support its field sales representatives.
During the reported quarter, Cardiovascular Systems sold over 15,000 devices, generating 92% of revenues. The company added 45 new peripheral accounts and 54 coronary accounts.
Coronary device revenues improved 51% year over year to $13 million while peripheral device revenues rose 13% to $37 million. Other product revenues increased 21.4% year over year to $4.0 million. Customer reorder revenues were strong at 98% of total revenue.
Margin
Gross margin in the reported quarter was 81.6%, up 119 basis points year over year, primarily on account of unit cost reductions and slightly higher devices ASPs.
Meanwhile, selling and administrative (SG&A) expenses contracted 17.6% to $33.9 million, while research and development (R&D) expenses fell 19.4% to $5.8 million. The resultant adjusted operating expenses declined 17.8% to $39.7 million, primarily exhibiting management’s cost realignment initiatives and timing of studies and projects. Consequently, operating profit improved to $1.0 million from a loss of $15.1 million a year ago.
Financial position
The company exited the second quarter of fiscal 2017 with cash and cash equivalents of $79.2 million, reflecting a 36.1% improvement from $58.2 million at the end of first-quarter 2017.